Maintaining Integrity: Community Association Code of Ethics

Does your board maintain a Community Association Code of Ethics? There is an old saying about how it is important to avoid even the appearance of wrongdoing or of indecency—and when it comes to the work of the HOA, that is very much the case. In order to maintain the trust of residents and community members, as well as to ensure full legal compliance, the association must go out of its way to uphold standards of ethical integrity. Even the appearance of special treatment or favoritism can lead to trouble.

This is especially true when it comes to personal relationships. Let’s say you hire a contractor to do a lot of ongoing work for your community; if a member of your HOA board began a romantic relationship with that contractor, and something goes wrong—either with the contracting job or with the relationship—your board could be eying a sexual harassment suit.

There are many areas in which it is crucial for associations to maintain high ethical standards, including the use of board resources for personal reasons, or personal connections between board members and outside vendors. The question is, how can the board seek to protect itself, and to ensure that it always does the right thing?

A good first step it to check with local laws and regulations. Many states have laws that govern the workings of an HOA, and in some states those laws ban board members from accepting goods and services from people they know outside of the association. A review of pertinent laws is a good first step.

Your HOA might also consider formulating its own, written standards of conduct. This written document can list the expectations for all board members. It can also detail the ways in which the board can deal with possible conflicts of interest; in the above mentioned case, of a contractor and a board member becoming romantically involved, a simple solution might be to ask the board member to simply step down, at least until the contract work is done.

Remember, in the end, that making ethical decisions is the best way to defend your association from trouble.